Tracking financial flows and investment needs in the transport sector
Making the case for shifting and increasing finance towards sustainable, low-carbon transport
The scale of transport investment worldwide is not clearly understood. In order to analyze and augment the level of investment in low-carbon transport, it is necessary to understand both the investment needs in transport infrastructure as well as the source, nature, vehicles, and recipients of current transport spending. WRI Ross Center for Sustainable Cities’ Energy and Climate team is undertaking a global and regional analysis of investment needs versus current financial flows to transport infrastructure.
This analysis of current financial flows follows three major paths: (i) estimate the total volume of global investment in the transport sector; (ii) differentiate for the first time public versus private and domestic versus international investment; and (iii) track the sources and instruments of private financial flows to transport. This analysis suggests that global transport investment is between $1.4 to 2.1 trillion annually—roughly between the GDPs of Mexico and United Kingdom, respectively. Approximately 58 percent of this comes from private sources.
Our analysis of global investment needs shows that, between 2015 and 2030, the transport sector would need $2 trillion annually to meet travel demand in the two-degree scenario for global climate change recommended by the IPCC, and $2.3 trillion in a more damaging four-degree scenario. Not only is it better for the planet, but pursuing the two-degree target is actually more affordable in terms of transport infrastructure investment.
Using this data, decision-makers and influencers across the world can better determine what actors and financing sources can serve as catalysts for expanding global investment in sustainable transport.